At a glanceWednesday, August 25, 2021

Collection Industry News At A Glance - August 25, 2021
Wednesday August 25, 2021
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Navient Says Verdict in TCPA Case Stops Misleading Business Practices that Harmed its Customers

Student loan servicer Navient received a favorable verdict in a 2019 case, Navient Solution LLC v. The Law Offices of Jeffrey Lohman et al., in the U.S. District Court for the Eastern District of Virginia last week.

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CFPB initiates new credit card agreement technical specs

Consumer Financial Protection Bureau (CFPB) officials said the organization has issued new technical specifications with regard to complying with credit card agreement and data submission requirements.

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CFPB Proposes Settlement with Debt Collector for Failing to Investigate Identity Theft Reports

With the ongoing COVID-19 pandemic, credit card companies may face increased scrutiny, as Consumer Financial Protection Bureau (CFPB) Acting Director Dave Uejio recently stated that "credit reports play a huge role in consumers' financial lives" and "we will not tolerate companies that put inaccurate data on credit reports or fail to investigate consumers' disputes."

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A Settlement From a Different Era?: Huge New TCPA Settlement Calls to Mind the Glory Days of TCPA Risk

As I’ve reminded folks a few times recently, the TCPA is the single largest cash cow in American history for the Plaintiff’s bar. More multi-million dollar settlements have been reached under the TCPA than any other federal statute–and it's not even close. Mercifully, however, the settlement dollars have been slowing down some in recent years and the overall “market” for TCPA settlements has been trending steadily down as risk around ATDS issues, standing issues and constitutional issues weigh in favor of the Defense.

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Credit Union Lending Picks Up in Most Areas

Credit unions were increasing their portfolios in most areas in June, except business lending and new car loans, where portfolios fell for the 24th month in a row after seasonal adjustments, according to a CUNA Mutual Group report released Tuesday. The Madison, Wis., trade group’s Credit Union Trends Report showed new auto loan balances were $141 billion on June 30, falling at a 3.3% seasonally adjusted, annualized rate from May to June, part of the May-through-October peak car-buying season.

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ACA Joins Industry Trade Groups in Support of Changing CFPB Leadership Structure

ACA International has joined nearly 30 industry trade groups, led by the Consumer Bankers Association, in a letter supporting legislation from U.S. Rep. Blaine Luetkmeyer, R-Mo., to transform leadership at the Consumer Financial Protection Bureau into a five-member bipartisan commission.

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Telemarketer Fees to Access the FTC’s National Do Not Call Registry to Increase in 2022

The fees for telemarketers accessing phone numbers on the National Do Not Call (DNC) Registry will increase incrementally in FY 2022.

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CFPB initiates new credit card agreement technical specs

Consumer Financial Protection Bureau (CFPB) officials said the organization has issued new technical specifications with regard to complying with credit card agreement and data submission requirements. Officials indicated the actions are in accordance with the Truth in Lending Act (TILA) and the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act) — noting credit card issuers would be able to use the CFPB’s Collect website to submit terms of credit card plans (TCCP) survey data; quarterly credit card agreement submissions; and annual reports regarding college credit card marketing agreements and data.

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Ontario Systems Acquires Katabat to Further Expand its Industry-Leading Collections Footprint

BURLINGTON, Mass., Aug. 23, 2021 /PRNewswire/ -- Ontario Systems, a leading provider of enterprise workflow automation software – which accelerates revenue recovery and removes friction from the payments process for clients in the accounts receivable management (ARM), healthcare, and government markets – today announced its acquisition of Katabat, a leading cloud-based collection platform providing cutting edge solutions to debt resolution for both lenders and borrowers.

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Bitcoin passes $50,000 after second-largest mortgage lender in the US reveals plans to accept crypto

What just happened? One reason more people don't own crypto such as Bitcoin is the small number of companies currently accepting it as payment, but that's starting to change. United Wholesale Mortgage (UWM), the second-largest mortgage lender in the United States, has announced that customers will be able to pay their mortgage using BTC later this year. In the company's second-quarter earnings last week, CEO Mat Ishbia said, "We've evaluated the feasibility, and we're looking forward to being the first mortgage company in America to accept cryptocurrency to satisfy mortgage payments."

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Healthy Consumer Credit Market Drives Return to Lending

The financial services industry is rebounding strongly from the early impacts of the COVID-19 pandemic, according to TransUnion’s (NYSE: TRU) Q2 2021 Quarterly Credit Industry Insights Report (CIIR). The auto, credit card, mortgage and personal loan industries exhibited renewed signs of strength at the mid-point of 2021.

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Have Student Loans? It’s Possible To Have Them Forgiven

Currently, 45 million people are carrying student loan debt, adding up to about $1.7 trillion total. Many borrowers might feel like they’re drowning; some can’t imagine a future where all their debt is paid off.

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The ‘astronomical’ increases in student debt are keeping 42% of teachers with over a decade of experience from paying off their loans

The National Education Association released a report examining the impact of student debt on educators, and it found that 45% of teachers have taken out a student loan to fund their own education, and 42% of those with 11 or more years of experience still have not fully paid them off. According to the report, while nearly 40% of that group has a debt balance standing at less than $25,000, 14% reported having a balance of at least $105,000 to pay off. The average debt load for experienced educators stands at $56,500, which is roughly the national average annual salary for teachers, according to the Bureau of Labor Statistics.

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California DFPI Seeks Several Comments on Draft Regulations, Including Debt Collection Licensing Act

The California Department of Financial Protection and Innovation (DFPI) continues to seek comments on the recently enacted California Consumer Financial Protection Law (CCFPL) and the Debt Collection Licensing Act (DCLA).

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MBA: Mortgage Delinquencies Fell Nearly 5.5% In 2Q 2021

Mortgage delinquencies fell in the second quarter of 2021, the Mortgage Bankers Association said today, with the delinquency rates for FHA and VA loans posting the largest quarterly decline in the history of its survey.

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How student loan debt grew to $1.6T and what can debtholders do to reduce theirs

Since 2003, the total national student loan debt surged by 602.5% to nearly $1.7 trillion, according to Even adjusted for inflation, Americans’ total student debt grew 389.5% in that same time. The average student loan debt was about $36,900 for the graduating class of 2021, the data showed. That's an average monthly payment of about $433, and an increase of 76% from the graduating class of 2000. 

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Mortgage refinance loans drove an increase in closed-end originations in 2020, new CFPB report finds

WASHINGTON, D.C. – A new Home Mortgage Disclosure Act (HMDA) data report  on residential mortgage lending trends released today by the Consumer Financial Protection Bureau finds that the total number of closed-end originations as well as applications increased substantially between 2019 and 2020. Closed-end originations (excluding reverse mortgages) increased in 2020 by 65.2 percent, from 8.3 million in 2019 to 13.6 million in 2020. Most of the increase was driven by the refinance boom observed in 2020. The data point also notes that, while the number of financial institutions reporting 2020 HMDA data declined compared to 2019, the number of closed-end records in 2020 increased compared to the previous year. While mortgage activity generally increased, year over year, significant differences between demographic groups persisted, including higher interest rates and denials among Black and Hispanic consumers in the mortgage market.

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Over 323,000 Federal Student Loan Borrowers to Receive $5.8 Billion in Automatic Total and Permanent Disability Discharges

Over 323,000 borrowers who have a total and permanent disability (TPD) will receive more than $5.8 billion in automatic student loan discharges due to a new regulation announced today by the U.S. Department of Education.  The change will apply to borrowers who are identified through an existing data match with the Social Security Administration (SSA). It will begin with the September quarterly match with SSA.

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What are the federal student loan limits for the 2021-22 school year?

When it comes to financing a college education, federal Direct loans are a good first choice. They come with a relatively low 3.73% interest rate, as well as federal protections like economic hardship deferment and income-driven repayment plans. But Direct loans can be restrictive, since you can only borrow up to a certain amount during the course of your studies. 

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Fintechs have a fraud problem with their Covid relief loans

New York (CNN Business)Fintech lenders helped speed the delivery of forgivable government loans to small businesses crushed by the pandemic. But these tech-savvy lenders may also have opened the door to widespread fraud and misuse of taxpayer money.

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DFPI Monthly Bulletin and Collector Licensing Requirement by December 31

California's Department of Financial Protection and Innovation provides a monthly bulletin. August announces the promotion of Melinda Lee to Deputy Commissioner for Debt Collector Licensing Division. It also discusses Debt Collector licensing, which requires Debt Collectors to be licensed in California. From their bulletin: "All debt collectors must submit an application for registration on or before Friday, Dec. 31, 2021, to continue operating in 2022, pending approval or denial of the application (Fin. Code § 100000.5(c)). Failure to submit an application by the Dec. deadline would preclude a debt collector from operating until the issuance of a license (Fin. Code §§ 100000.5100001(a)).

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The Bureau continues to fight to help alleviate housing insecurity through its Tech Sprint Program

I am pleased to announce that the Consumer Financial Protection Bureau will participate in the Census Bureau’s The Opportunity Project (TOP)  “The World Post COVID-19” tech sprint program. The program’s six tech sprints will focus on post-pandemic challenges. The CFPB is partnering with the Department of Housing and Urban Development (HUD) to lead a tech sprint on post-pandemic housing challenges.

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T-Mobile confirms that personal data of over 40 million customers was stolen by hackers

T-Mobile confirmed Tuesday that the personal information of 47.8 million people was stolen in a data breach on Monday. Records from 7.8 million current T-Mobile customer accounts were taken along with 40 million records of former or prospective customers, the company said.

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